Greetings, and welcome to the Prenetics Fourth Quarter and Full Year 2025 Earnings Conference Call. As a reminder, this call is being recorded. Your hosts today are Danny Yeung, Chief Executive Officer and Co-Founder; and Stephen Lo, Chief Financial Officer. Mr. Yeung and Mr. Lo will present results of operations for the fourth quarter and full year ended December 31st, 2025, and provide a corporate update. A press release detailing these results was released today and is available on the Investor Relations section of our company's website, www.prenetics.com. Before we begin the formal presentation. I would like to remind everyone that statements made on the call and webcast may include predictions, estimates and other information that might be considered forward-looking. These statements are made under the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. While these forward-looking statements represent our current judgment on what the future holds, they are subject to risks and uncertainties that could cause actual results to differ materially and are not guarantee of future performance. You are cautioned not to place undue reliance on these forward-looking statements, which reflect our opinions only as of the date of this presentation. Please keep in mind that we are not obligating ourselves to revise or publicly release the results of any revision to these forward-looking statements in light of new information or future events. Throughout today's discussion, we will attempt to present some important factors relating to our business that may affect our predictions. Unless otherwise specified, all information provided on this call is as of today's date, and we undertake no duty to update such information. For a more complete discussion of these factors and other risks, you should review our annual reports and other documents and disclosures on file with the Securities and Exchange Commission at www.sec.gov. At this time, I'll turn the call over to Prenetics' Chief Executive Officer, Danny Yeung. Please go ahead, sir.

Great. Thank you. Thank you, and good morning, everyone. Welcome to our Fourth Quarter and Full Year 2025 Earnings Call. For those who have been following our story, thank you very much for your continued support. And for those new to Prenetics, you are joining us at a pivotal inflection moment. 2025 was the most transformative year in our company's history. We achieved record revenue of $92.4 million, a 480% increase year-over-year, driven by the explosive launch of IM8, our premium consumer health brand cofounded with David Beckham. In just our first year, IM8 reached a $120 million annualized revenue run rate, a trajectory that we believe is one of the fastest ever recorded in the global supplement industry. We also completed a decisive strategic pivot, divesting our noncore assets to become a pure-play consumer health leader. This has sharpened our focus, improved our margin profile and solidified our balance sheet, which now stands at approximately $171 million in total liquidity with 0 debt. Most importantly, we now have a clear road map to adjusted EBITDA profitability by Q4 of 2027, supported by strong unit economics and significant operating leverage. Today, I'll walk you through our strategic transformation and the incredible growth story of IM8. Stephen will then provide a detailed overview of our financial results, and I'll conclude with our outlook for 2026 before we open it up for Q&A. Let me begin first with the transformation that occurred in 2025 and early '26. Our goal was to streamline the company and focus all of our resources on the highest growth, highest margin opportunities. We executed this by divesting 3 noncore assets. In June 2025, we sold ACT Genomics for $72 million with $46 million in cash back to Prenetics. In January of '26, we exited the low-margin Europa…

Thank you, Danny, and good morning, everyone. I'll begin with our fourth quarter results. Total revenue in the fourth quarter surged 457% year-over-year to $36.6 million and increased 55% sequentially from Q3. This was driven by IM8, which contributed $27.4 million in Q4. Gross profit in Q4 grew over 800% year-over-year (sic) [ 804% ] to $21.7 million with a consolidated gross margin of 59%. Adjusted EBITDA loss for the fourth quarter was $2.3 million, a 70.4% improvement from the same period in the prior year, demonstrating the significant operating leverage in our model as we scale. For the full year 2025, total revenue was $92.4 million, up approximately 480% from 2024. Gross profit was $48.9 million, an approximately 428% increase. Full year adjusted EBITDA loss improved by 27% to $13 million. IM8 was a clear driver, generating $60.1 million in revenue for the full year 2025 at a healthy 63% gross margin. The divestiture of low-margin Europa business will further enhance our consolidated margin profile in 2026. Looking ahead, we are confidently reaffirming our 2026 guidance. We expect IM8 revenue of approximately $180 million to $200 million for full year 2026, representing nearly 300% year-over-year growth. We are targeting a gross margin of approximately 60% in full year 2026. We expect full year 2026 adjusted EBITDA loss of approximately $16 million to $20 million as we continue to invest in marketing to drive growth with a clear path to achieving adjusted EBITDA profitability by Q4 2027. With that, I'll turn it back to Danny for closing remarks. Danny? [Audio Gap]

Danny, We are unable to hear you, is your line muted?

Sorry about that. Yes. Thank you, Stephen. Yes, to summarize, we have successfully transformed Prenetics into a high-growth, well-capitalized consumer health leader. IM8 is on a clear path to becoming a $1 billion global brand. And even for myself in my last 20-plus years of entrepreneurial career as both an operator and investor, I have never seen such strong momentum in one brand. We have the team, the strategy and the financial strength to execute on this massive opportunity, and I'm particularly excited about what's ahead. In Q4 of this year, we plan to announce 2 new products that will enter very large total addressable markets. These launches will further diversify our portfolio and accelerate our growth trajectory. I am more confident than ever in the future of Prenetics and IM8. Thank you for joining us today. I will now turn it over to the operator for Q&A.

[Operator Instructions] And our first question will come from George Kelly with ROTH Capital Partners.

First one just on the 90-day offering. I was wondering if you could walk through the reasoning behind having that available? And when do you expect the benefit to be to your model?

Yes. Great question. So we actually started quarterly subscriptions in the U.S. first in December, right? And typically, how we do this is we do a lot of testing on our website optimizations on a daily basis. So we start testing in the U.S. It was clear basically after a month of testing that consumers, number one, they really like this option. And number two, it provides benefits for both sides. So the benefits from consumer-wise, they get 3 months of product at a time. Consumers also save about $10 monthly as well, right? So from a comparison perspective, typically, a normal customer previously, they would buy a 1-month subscription for $89 monthly. And since the introduction of the quarterly subscription, it becomes $78 times 3, right? So there's basically $235 for quarterly subscription. So we get that payment upfront. And we also save on logistics cost because instead of shipping 3 monthly shipments, we ship it all at once. And so what that has done is actually has significantly increased our average order value from approximately $130 from end of Q4 to $233. So basically, if you think about every single new customer that's coming into im8health.com, on average, every new subscriber is paying us $233. So what this does is that basically it shortens our payback period or the period of time that we recoup our customer acquisition cost. So we believe this is a significant benefit. And at the same time, now for consumers, they now have 3 months of product to try the product, right? And based upon our clinical trial results after 90 days, individuals will then significantly feel the difference. For example, 95% of individuals after 90 days have felt a notably difference in higher energy levels, better sleep quality, better recovery, greater sleep, right? So we do believe the 90 days will also increase retention rates as well. So overall wise, we believe it's going to be a significant enhancement to our overall business.

Okay. Okay. That's helpful. And then a second question, Danny, in your concluding remarks, you talked about 2 new SKUs coming this year. I understand if you don't tell us what they are at this point, but maybe if you could provide a little more information just about timing of those launches? And how should we broadly think about sort of new product opportunity? Do you expect any kind of new product, at least in the near term to be similar to what you offer now where it's a subscription and it's monthly? Or might you expand into categories where it's a sort of whole different -- there's whole different characteristics to the products?

Great question. Yes. So right now, our plan is to release 2 new SKUs by the end of Q4 of this year. Now due to competitive reasons, I think we don't want to release too soon what these 2 SKUs are, but it will be in the health and performance space. And it will definitely be in the health supplement categories, right? And also, these will be very 2 large total addressable markets, which competitors already doing easily anywhere from $500 million to $1 billion annually just in terms of these SKUs. So we do believe it's going to -- it could be a significant growth driver for us.

Okay. That's helpful. And then last question for me. With respect to the guidance you put out for IM8, the $180 million to $200 million for the year, I guess 2 questions on that. First, we're now through January and into February. I was wondering if you could help at all just the trends you've seen so far. I think January is a pretty important month for the year. So any sort of commentary there would be great. And then secondly, are the new products baked into that guide?

Yes, great question, right? So I think we are still seeing continued momentum. So momentum hasn't stopped basically on a month-over-month basis, right? In terms of the 2 new products in terms of the revenue guidance, those are not baked into that $180 million to $200 million number.

[Operator Instructions] And we will go next to Thomas Forte with Maxim Group.

Great. So first off, Danny, congratulations on a wonderful fourth quarter and year and the breakout performance of IM8. So I have 3 questions. I'll go one at a time. So the first one is, can you talk about your customer acquisition costs and lifetime values for IM8 and how that's trended over time?

Yes. So the customer acquisition cost, right, we actually laid this out in our investor deck. So we actually have an investor deck that we published on our website. A there's a link to it on the press release. So you should think about it as it's roughly about 0.8x in terms of return on ad spend. So if let's say, our blended average order last year for 2025 was $110, our CAC was $130, right? And then the key thing about this is that the payback period is roughly 3.4 months. So basically, we factor that in when we're making decisions in terms of increasing spending or not increasing spending, right? But given the short time period of 3.4 months, we believe we actually have significant flexibility to go from 3 to 6 months, right? Because in the DTC space, if you're at 3 months, it's excellent at 6 months is good. So that means we have a lots of runway, right? And your other question in terms of how that has trended. Our CAC has, of course, our average order value has increased significantly from $110 basically to $233. Equally, our CAC has increased with that at the same ratio. So we -- even from last January until now, we have not seen significant increases of CAC even as we scale, right? And also just to share is that we've been primarily focusing our marketing efforts, digital marketing efforts just on Meta and Google, roughly 85% on Meta, 15% on Google by the end of this quarter and into Q2, we're going to be diversifying our marketing channels to include YouTube, podcasts, AppLovin, TikTok. So we believe we're also getting able to diversify our marketing channels even much more in greater detail.

Excellent. And then for my second question, so one of the many things you're doing that's impressed me is capitalizing on artificial intelligence. Can you talk about how you're using AI, including from a digital marketing standpoint?

Yes. Great question. So I'm a big component -- I mean a big proponent of the whole entire company using the latest AI tools and systems in place for us, not just from a digital marketing perspective, but across the organization, every function, every single employee doesn't matter whatever department it is, right? So my team knows this very, very well, right? Any free time I have personally, I'm looking -- I'm studying AI like crazy, right? So for example, how we leverage AI in terms of digital marketing efforts on a weekly basis, we'll roll out anywhere from about 800 to 1,000 new ads. And we just look to algorithm decide what that works. And then only about 10% of these ads will actually work. And we call these a winning ad. And then every single week, we'll replicate basically, we'll take 10% of those that work, and we replicate another 800 ads on a weekly basis. So that gives you one example of basically how we use AI. And of course, I think if you look in the investor deck, you'll also see we launched an AI video last September with Aryna Sabalenka right before the U.S. open. And this one AI video, it basically -- it was the highest number of views of any brand on Instagram. It reached 233 million views with one AI video featuring Aryna Sabalenka. So when you get 233 million views in one video at top of funnel, you can then significantly much easier we target new other customers that have seen that video, right? So I think these are specific examples of how we're leveraging ad. We use AI in all parts of our business.

Wonderful. And then last one for me. You've done a great job of divesting multiple successful businesses. You have an unbelievable balance sheet. As a result, can you talk about your strategic M&A strategy, including your decision process and when to build versus when to buy?

Yes, [ Kirk ] Yes, I think 2025 was an extremely busy year, right? You can see like not only have we built a very strong business, which was from scratch, right? We built that organically, the whole brand, the playbook, all the doctors, all the scientists, all the brand ambassadors and of course, the product, right? At the same time, we executed the selling of 3 of our noncore assets because the growth of IM8 was just so unbelievable that we knew we needed to double down on that, right? And then so now we have a very strong balance sheet. I mean, the reality is we have so many options available to us. But I would say my first -- our first focus is going to be built organically because, again, we believe we already have this performance marketing flywheel behind us, unless there is a very strategic M&A potential. Right now, our main focus is just building organically because, again, that's something that we can control very well. But again, we're always open for new opportunities if it makes sense.

Our next question comes from Alex Hantman with Sidoti & Company.

Congrats on the quarter. Maybe we could just start on the revenue growth for this year. I know you mentioned that new products are not baked into that. Could you share a little bit more about how much of the growth is expected from customer base expansion versus like average revenue per user uplift from quarterly plans?

So I would say -- so the growth is just based on come from -- majority of that growth is going to come from basically new customers. right? So if you think about it, I mean, we achieved $60 million full year revenue in our first year, and that's still a very new brand. So this year -- and while there's a lot of people that have heard about IM8, there's still a significant population around the world that hasn't heard about IM8 or hasn't tried or used the product, right? And once people try the product, they use the product, again, the product is effective, they'll stick on. So a significant part of that growth is going to come from new customers. And if you look at our breakdown in terms of our top 5 markets with the U.S. being #1, 40% of revenue. So last year, U.S. only represented $23 million of $60 million, right? So I think realistically, the U.S. market can easily support or absorb yes, $300 million to $400 million on this one product, right? So there's still lots of headways of runway to go, right? #2 market is Canada, #3 is U.K. #4 is Australia, #5, Singapore, right? So we're a truly global diversified brand. So we believe there's significant opportunity to just by acquiring new customers onto the platform.

Great context. And 2 more from us. Dan, I know you just spoke about some of the international revenue opportunities. I'm curious, as you started localizing websites, what kind of revenue uplift have you seen? And what international market then are you sort of most excited about given that?

Yes. Great question, right? So this is again another example of how we're in the process of leveraging AI tools specifically for international localization efforts. So by Q2 of this year, we will be localizing in at least 5 different markets in terms of our whole website, our ads, our campaigns, for example, in Germany, right? So a lot of the ads -- Germany is now, I think, #8 or #9 in terms of global top markets. So these markets, we believe the localization of our entire website will be at least a 10% to 15% increase in local markets, right? And then so again, that's something that we're going to be launching by Q2, likely by the end of this quarter, actually.

Perfect. And last one from us. I know you mentioned the Q4 2027 EBITDA profitability target. Could you talk a little bit about some of the key factors to achieving that, marketing leverage, scale, product mix? And do you have an accompanying EPS target?

Yes. So I think, again, as we scale and given our gross margin is at 60%, profit will come with that, right? So we're going to be able to have so much more leverage once we get to $250 million, $300 million in revenue because we have our manufacturers, our suppliers, our logistics on. So we do believe that we can even slowly increase our margins from 60% to 62%, 63% within the next 12 to 18 months as well, right? So that, coupled with the scale, will then get us to -- we believe by profitability by end of Q4 2027. It just kind of continue doing what we're doing now by a much greater scale. And of course, all the costs get absorbed, okay?

And this now concludes our question-and-answer session. I would like to turn the floor back over to Danny Yeung for closing comments.

Great. Thank you, everyone, for joining us this morning. Again, I can't be more excited about what the future holds. I know I've been an entrepreneur, as mentioned for 20-plus years, but this is something I'm incredibly passionate about building a global brand that's making impact to millions of people around the world. We have a lot of great support from around the world as well from highly influential athletes, doctors, professors that makes it so much fun to be able to go on this journey. So again, thank you, everyone, for being with us today.

Ladies and gentlemen, thank you for your participation. This does conclude today's teleconference. You may disconnect your lines, and have a wonderful day.